Northern Financial Reports First Quarter of Fiscal 2008 Results

Northern Financial Corporation (TSX: NFC) ("Northern" or the "Company") today reported results for its first quarter ended June 30, 2007 of its 2008 fiscal year. Net income for the quarter was $503,879 or $0.05 per share compared with a net loss of $2,461,024 or $0.29 per share in the prior year as restated in the Company's year ended March 31, 2007 financial statements. Core brokerage activities improved significantly over the prior year. As well, in the first quarter of the prior year the Company incurred an unrealized loss in its merchant banking portfolio.

Consolidated revenue for the quarter ended June 30, 2007 was $6,851,805 or up 176% from revenue of $2,481,325 in the first quarter of fiscal 2007.

Commission revenue was $2,918,093 for the quarter ended June 30, 2007 compared to $2,457,994 in the prior year. This 19% increase was driven by increases in all areas of the business including retail, institutional and high net worth. Underwriting and advisory revenue increased to $3,139,803, an increase of 93% from $1,625,680 in revenue in the previous year. Trading revenue was $423,650 in the current year or up 44% compared to $293,116 in the prior year. Interest revenue of $389,486 was relatively consistent year over year.

Merchant banking activities generated revenue of $24,969 in the current quarter compared to a loss of $1,892,383 in the prior year. The Company sold most of its merchant banking investments during the latter part of the prior fiscal year.

Total expenses for the period ended June 30, 2007 were $6,445,640 compared with $5,302,349 in the prior year. Brokerage operations costs increased to $6,198,633 from $5,667,651. This increase was largely attributable to an increase in variable compensation associated with the higher level of revenue. Interest expense decreased to $228,365 from $301,363 due to a lower balance of loans outstanding through the period. Merchant banking expenses were nil compared to a recovery of $1,066,261 in the prior year. The recovery in the prior year represented a reduction in accrued variable compensation relating to the decline in value of the merchant banking investments.

As at June 30, 2007 the Company had cash, deposits, and securities of $9,058,444 compared with $16,322,954 as at June 30, 2006.

Vic Alboini, Chairman and Chief Executive Officer, commented on the first quarter results: "We are pleased with our first quarter results as all parts of our business are contributing: capital markets, retail and high net worth. We have a strong market share in financings and mergers and acquisitions for small cap companies."

Northern Financial Corporation wholly owns Northern Securities, a full service investment dealer that provides financial advisory services to retail and institutional clients and investment banking services to small capitalization companies.

Contacts: Northern Securities Inc. Ann Krallisch Director, Business Development (416) 644-8113 (416) 644-0270 (FAX) Email: akrallisch@northernsi.com